ELMSEED ENTERPRISE FUNDenabling entrepreneurs since 2001

www.elmseed.org(203) 903-1737

info@elmseed.org

P.O. Box 207148 New Haven, CT 06520

!e Mission!e Elmseed Enterprise Fund’s mission is to create successful small businesses in New Haven by providing start-up capital, business training, technical assistance, and a network of peer support.

By providing access to small, low-interest loans and technical assistance, Elmseed seeks to open the capital markets to motivated entrepreneurs who lack access to traditional capital and the resources necessary to start or expand their small businesses. Elmseed is commit-ted to encouraging sustainable economic self-reliance in the greater New Haven area.

Elmseed’s small but signi"cant loans and intensive technical support aim to empower clients to lift themselves out of poverty and become "nancially self su#cient.

Letter from the CEOOver the past year Elmseed has seen demand for services rise as people turn toentrepreneurship to forge their own opportunities. In the face of high unemployment,rising costs of living, and tightening lines of credit, Elmseed is working with smallbusinesses to build sustainable growth from the ground up. !rough our loans,consulting services, and business training classes, we are helping clients achieve theirentrepreneurial goals.

We have continued to expand our impact over the course of the last year, workingwith 68 clients working to start or expand businesses as diverse as hair salons, hot dogcarts, and Mediterranean restaurants. Elmseed helped "nance a car for a brand newtransportation business that is now on track to do $150,000 in revenue this year. Wehelped renovate a new day-care facility which will serve up to 11 children. And we haveworked with a local salsa producer to widen her distribution, with her product in over 30stores.

Our pace of lending has grown signi"cantly over the past year, reaching 8 loans totalingover $22,000. Moreover, we have achieved this growth in a way that maximizes bothimpact and sustainability. Six new jobs have been created through ventures we havefunded, and our repayment remains at 100% for these loans. Our new applicationis simpli"ed and streamlined, allowing for faster loan decisions as our volume ofapplications rises. Soon we will o$er credit-reporting capabilities to help clients improvetheir credit, helping us become a long-term solution to their capital constraints.

We continue to serve a broad range of entrepreneurs, and have re"ned our o$erings tomatch di$erent needs. Loans are now more accessible for people who lack only capital,while our Entrepreneurship Development Course is perfect for those with an incipientidea who need helping turning their idea into a business plan. For the "rst time ever weare expanding our outreach to the Spanish-speaking community, with a full department tounderwrite loans, consult, and teach a training course in Spanish.

Elmseed could not exist without the incredible support of our community partners,committed volunteers and, most of all, generous donors, all of whom join us in ourmission of creating successful and sustainable small businesses. We wish to thank all oursupporters for your continued commitment to Elmseed and the people we serve.

Sincerely,Jared JonesCEO and Executive Director

www.elmseed.org

About New HavenEntrepreneurship is the engine that has fueled the growth of New Haven since its incep-tion. !e city’s "rst settlers came to the region in the mid-17th century with the intent to establish a commercial empire and laid the groundwork that would eventually grow New Haven into a center of commerce.

After the Second World War, the economy faltered as the city’s population declined. It wasn’t until the mid-1990s that the city began to see real growth. Development has stemmed from a focus on urban renewal at the grassroots level by supporting small busi-nesses and sustainable growth e$orts.

New Haven is a city of untapped human potential. According to the most recent census data available, a quarter of the city’s population lives below the poverty line and a "fth of the city’s households earn less than $10,000 in income. Provided the opportunity, many of these people could realize their entre-preneurial dreams and contrib-ute to New Haven’s growth.

Elmseed can provide that opportunity by providing capital to those individuals who could not otherwise obtain it and empowering them to use their potential to its fullest extent. By providing micro lending, business planning, and support services to New Haven residents, we are utilizing the very same entrepreneurial spirit that built this city from the ground up to rebuild the city once more. !e goals of New Haven and Elmseed are inex-tricably linked—to create jobs, promote sustainable economic growth, and help individu-als achieve their dreams.

Minorities & BusinessAccording to the latest report released by the US Small Business Administration in 2007, minorities owned 18% of the approximately 23,000,000 businesses in the US while comprising roughly a third of the population. Despite this underrepresentation, growth in this sector has been rapid since 1982, when minorities owned only 7% of all businesses.

Growth in this segment remains high today. Elmseed hopes to help foster this growth and develop small business particularly in New Haven’s minority community. Over 70% of Elmseed’s clients are minorities. Our marketing is particularly targeted to underserved communities, and Elmseed is increasingly reaching out to New Haven’s Hispanic com-munity. Our Fall 2010 Small Enterprise and Entrepreneurship Development Conference featured Spanish workshops and we recently held our "rst Spanish-speaking Entrepreneur-ship Development Course, for which 27 clients were registered.

www.elmseed.org

How We OperateElmseed’s goal is to target a "nancially underserved community of motivated, low- income entrepreneurs who lack access to traditional capital. Elmseed has attracted clients from diverse industries including food service, printing, fashion design, cosmetics, event plan-ning, and auto detailing.

When potential clients apply to Elmseed, they receive a free consultation with our Direc-tor of Client Intake. During the meeting, we try to assess the client’s stage of business development and ultimately o$er a recommendation for placement into one of our three core products: consulting, loan preparation, or the Entrepreneurship Development Course (EDC).

Elmseed’s Entrepreneurship Development Course is a four-session workshop designed to help clients re"ne and organize their business ideas. !rough small group activities and simulations, clients critique each other’s ideas, analyze the essentials of their business models and work through common mistakes entrepreneurs make when starting a business. Clients hone their skills by identifying the strengths and weaknesses of their own business, not by merely listening to a lecture or reading a textbook.

For clients who are at a more developed stage of business planning, Elmseed o$ers project-based consulting services. Consultants work with clients on one individual project at a time, with the goal of “graduating” clients on to their next project. Sample projects include creating business plans, crafting "nancial projections, conducting market research, and developing marketing strategies.

Elmseed also o$ers loans of up to $5000 to cover capital expenditures and start-up or ex-pansion costs. Applicants are evaluated primarily on their proposed use of funds, business feasibility, personal and business cash %ow, and credit history. Ultimately, Elmseed consid-ers the potential impact of the loan as much as we consider repayment rates. !is philoso-phy stands in stark contrast to traditional lenders, and allows us to better achieve our social mission of assisting clients who otherwise would be unable to procure funds.

Under Elmseed’s guidance, many of our clients have succeeded in making their business their primary source of income, and some have even created jobs for others. Over our ten years of operation, Elmseed has disbursed over $80,000 in loans while maintaining an overall repayment rate over 80%. In the past 12 months, we have disbursed $22,000 in loans, while maintaining a 100% repayment rate.

www.elmseed.org

On !e HorizonOver the course of the past year, Elmseed has expanded rapidly to better meet the needs of our clients. We have recently developed a preliminary loan application to allow us to more e#ciently partner with community organizations, and a “fast track” process to expedite loan decisions for our most advanced clients. We have also taken steps to improve our outcome tracking and metrics system, in order to better analyze our community impact. Looking forward, Elmseed is awaiting approval to report credit as a full member of the Credit Builders’ Alliance, after which we will begin to o$er credit-building loans. !e or-ganization is also increasing engagement with New Haven’s Spanish-speaking community, and working to achieve an organization-wide goal of disbursing ten high-impact loans by January.

Joining the Credit Builders’ Alliance is an important component of Elmseed’s operations going forward. Membership in the Alliance will allow us to pull credit scores as well as report credit for our clients. Seeing as many of our clients turn to Elmseed because they cannot access traditional means of capital, improving their credit scores would permit these individuals to apply for larger business loans through traditional sources later on. Essentially, membership in the Credit Builders’ Alliance will bene"t both Elmseed and our clients; the ability to view our clients’ credit histories will help us underwrite loans more e$ectively, and credit-reporting capability will allow us to improve the personal "nancial situations of many of our clients.

!is year, Elmseed is also taking concerted steps to broaden and improve our engagement with New Haven’s large Spanish-speaking community. !anks to Elmseed’s newly estab-lished Spanish Outreach department, we have been able to start marketing our services and loan products to this unique demographic. Peer micro"nance institutions throughout the US have had great success working with Spanish-speaking communities, and Elmseed hopes to replicate this success by partnering with community organizations and local lead-ers to receive client referrals for our consulting and loan services.

Lastly, Elmseed has set a bold goal of disbursing ten high-impact loans this semester. !is would be the largest number of loans the organization has ever distributed in a semester-long period. While the goal is ambitious, we believe the organization is up for the chal-lenge. With our new loan application process, membership in the Credit Builders’ Alli-ance, talented client recruitment team and high quality consulting resources, Elmseed is in a stronger position than ever before as we work to continue growing our impact in New Haven.

Antoine Scott owns and runs QCONN Shuttle, which o$ers service between New Haven, Bridgeport, and New York. He has over thirteen years of experience in the transportation indus-try, and has always aspired to be an entrepreneur. Before applying for his Elmseed loan, Antoine worked with Elmseed to develop QCONN’s in-dependent contractor business model and expand its marketing campaigns. Antoine is using his El-mseed loan to purchase a new vehicle for his %eet.

High-Impact LoansTahania Cunningham is set to open for business. In mid-November, her lifelong dream to start “Symbol of Love,” a childcare center, will come into fruition. But just months before, Tahania was a set of statistics. Four children, no job, running out of welfare: no one looked beyond her num-bers. She had the ambition, she had the location, and she even had the personal "nancial investment. But she was “high-risk,” a label thrust on her every time she applied for a loan. When Tahania contact-ed Elmseed, the group saw her numbers; Elmseed knew she was “high-risk”. But sta$ers balanced risk against impact, concluding that her ambition and the proposal’s prospective impact far outweighed the chance of default. Tahania was assigned two consultants who ensured that she met industry regu-lations and had her "nancials in order before she applied for her loan. Elmseed guided Tahania to apply for the right kinds of insurance, meet state childcare requirements, pass licensing inspections, open a business bank account, and make necessary capital investments. With guidance from her con-sultants, Tahania received an Elmseed loan to renovate a church basement for her childcare center.

Edwin Pabon, a Puerto Rican immigrant and father of three, had worked exclusively in the food industry throughout his life as a at a fast food restaurant. In early 2010, he sustained an injury that forced him to "nd another means to support him and his family. Edwin struggled to "nd work dur-ing the economic downturn until he decided to capitalize on his prior work experience and ful"ll his lifelong goal of owning his own business. Working with the Spanish-American Merchants Associa-tion (SAMA), he began to look into operating a hot dog cart in Fair Haven, Connecticut. In spring of 2010, Edwin was referred to !e Elmseed Enterprise Fund, where he was paired with one of our Spanish-speaking consultants to help ful"ll the requirements for starting his business and applying for an Elmseed loan. After receiving the $2,000 loan, Edwin was able to purchase a vendor cart and together with his wife, Lizbeth, created E&L’s with the mission of providing local residents and busi-nesspeople with an a$ordable snack, lunch, and dinner option by selling hot dogs, snacks, and bever-ages to Fair Haven pedestrians. !anks to E&L’s success, the two are now planning to expand their business by purchasing a larger cart. Edwin has made every one of his loan repayments on time thus far and is considering accelerating the repayment from 12 months to 10 months in order to apply for a second, larger Elmseed loan.

www.elmseed.org

Our Clients

Dawn Poindexter owns Red Carpet Services, a hair salon that operates next to the Yale New Haven Hospital. Dawn has been working with Elmseed consultants to market her business more e$ectively to a broader target market as well as reduce her "xed costs. Addtionally, Dawn is working with her consultants to apply for a loan for equipment to expand her business into the hospital itself to provide on-site salon services to patients who are at the hospital for extended periods of time.

Jean and Robert Ross are the owners of Tropical Breeze Jamaican Kitchen, located in West Haven. !e New Haven Advocate has deemed Tropical Breeze as “hard to beat” and Connecticut Monthly claims that they have the “best jerk chicken”.

Elmseed has been helping Jean and Robert gauge their "nancial situation as well as create a comprehensive business plan and set of "nancial projections to apply for funding from the Small Business Association to expand into New Haven.

Cheryl George, a longtime Elmseed client, owns and oper-ates Simplicity Treats, which o$ers homemade desserts baked in small batches. Cheryl has worked with Elmseed to increase sales by explor-ing new distribution channels on Yale campus as well as creating new, higher margin products. Cheryl hopes to one day use proceeds from Simplicity Treats to fund her daugh-ter’s way through college.

Increase in Client Volume Since 2010

Loan Repayment Rate

2011 Funding and Budget

8

Elmseed By !e Numbers

Loans Disbursed Since Oct. 2010

$8,000Operating Budget

Clients Served68

0 Paid Sta!

44 Volunteer Sta!

100%Loan Repayment Rate Since Oct. 2010

$22kValue of Loans Made Since 2010

6 New Jobs Created

Portfolio At-Risk0%

www.elmseed.org

About UsBoard of Directors

Linda Berard, Citizens Bank Cynthia Horan, Yale University Department of Political Science

Laura Huizar, Yale Law School Nathan Huttner, Yale School of Management

Elizabeth Ann Parcella, Wiggin and Dana, LLP Robert Reed, L’Oreal USA

Julie Swerdlow, Yale School of Management Joshua Sweren, CPMG

Executive Board Co-Executive Director, Chief Executive O#cer: Jared Jones Co-Executive Director, Chief Operating O#cer: Jasjit Singh

Chief Financial O#cer: Sinye TangDirectors of Client Services: Ginger Jiang & Drew Macklis

Directors of Client Recruitment: Mattie Wheeler & Jenny DaiDirector of Spanish Outreach: Christina Ceballos

Director of Development: Ben PrawdzikDirectors of Strategy: Noah Sheinbaum & Tonia Sun

Sta! Members

Client ServicesChris Akers

Daniel HarveyTim Hillas

Jennifer Qiao Daniel RebelloNeha Srivastava

Brandon StallingsAmy Xiao

Deborah OngMason Liang

Simon PodhajskyChristina Wang

Client RecruitmentCharlotte Dillon

Julia GranataInayat Khosla

Mary LiuJohn StillmanLian Zucker

Geng NgarmboonanantGeorge Tang

StrategyJungwon ByunEli Markham

Young XuDaniel AineahGrace Zhang

FinanceMichael LeiSagar RajuAkash ShahChase Ross

Harsha Mishra

DevelopmentShibi KannanJulie Leong

Spanish OutreachAdriana CamposAlvaro TodrigoAmauri TorresEvelyn Nunez

Julian DebenedettiMaria Alejandra Osorio

Our Supporters

Small Loans, Small Businesses,Big Dreams.

InstitutionsCitizen’s Bank

Campus Micro"nance AllianceBezalel FoundationBlue State Co$ee

United Illuminating Company!e Bershad Foundation

Yale Undergraduate Organizations Funding CommitteeDwight Hall

Start Bank (First Community Bank)New Alliance Bank

O#ce of New Haven and State A$airsEconomic Development Corporation of New Haven

JuntaCarol Wall and Vance Wall Foundation

Gateway Small Business CenterUnited Way of Greater New Haven

Community Fund for Greater New Haven

IndividualsBrian FriedmanSusan Bershad

James Tanner and Catherine AllegraJoshua Sweren

Allen and Joan BildnerQiang and Mindy Song

Kenneth and Norma SpungerMurry and Dawn Stegelman

Ted and Alice CohnPuig FrancisMary HickeyElisha Wiesel

Margaret SoleauJaswinder Singh